Because I take cash deposits at a number of campgrounds around the country, we have accounts with 30+ different banks. Every few weeks one of them asks for some outrageously intrusive piece of information or paperwork. And I ask them, what is this for, and get told that it is "a new requirement of the federal government." I appreciate the feds have put in all kinds of new bank account controls in a misguided attempt to do something about terrorism (side bet: most of these have more to do with the drug war than terrorism). But in most of these cases, either my 29 other banks are breaking the law, or my bank is misguided. Or worse, BS'ing me by falsely blaming their own information acquisitiveness on the feds.

Today I had a tiny, tiny telephone company in southern New Mexico call me to say they needed my drivers license and a utility bill from a New Mexico resident to add a phone line. This new phone line is 1) for my corporation and 2) about the 8th account with this same phone company. Given the area they operate, I may be their largest customer in town. I told her I thought the requirement that a corporate officer give up his drivers license to get an extra corporate phone line was absurd, and further if they wanted a personal utility bill in New Mexico they would be waiting forever. After being kicked up to their supervisor, I was told that they would settle for proof of my corporations federal tax ID # and a copy of my lease for the campground in question proving I was the legal occupant. When asked why -- I mean, do they really have a problem with people paying the phone bill for locations that are not theirs -- they said it was now required by the federal government.

Really? this sounds like BS. Again, my 30 other phone companies would probably like to know they are breaking the law. But who knows, maybe the feds really care. If I had to bet, this would again be chalked up to the war on terror, but if I really could get to the bottom of it, I would find its about the drug war -- one time somewhere a drug dealer set up a phone line in an assumed name in an abandoned building and now I have to get fingerprinted and have an FBI check to get a phone line (don't laugh at the latter, one still has to get fingerprinted for every liquor license as a holdover from 80 years ago when gangs ran speakeasy's).

I suspect that in each case cited above, either a federal bureaucrat or a corporate lawyer decided that the company wasn't quite meeting reporting requirements, and the company went beyond the regulations to keep the feds at bay.

My personal experience with banks and some investment firms is that they create forms that go beyond the minimum required by a new federal regulation, but then blame the regulation for the entire form. A few years ago I challenged a Bank of America branch officer about a such a form, and she admitted that some of the fields were not required. When I helped my 18-year-old daughter open an account at SunTrust, it had shorter forms and less onerous requirements despite being only 100 yards away from my bank.

But in most of these cases, either my 29 other banks are breaking the law, or my bank is misguided.

What Dr. T. said.

I have some involvement with the Sarb-Ox compliance team at work.

The law (Sarb-Ox specifically, but others I have dealt with in the compliance world) is pretty arcane, imho. Compliance seems to be a matter of opinion, not following a set of instructions for building a widget.

Not Sure

"Compliance seems to be a matter of opinion, not following a set of instructions for building a widget."

I'm completely convinced it's designed that way. If the rules are clear, you can follow them (or not, I suppose). If the rules are not clear, however, everybody ends up violating them at one time or another, leaving the government free to stomp on you whenever they have a mind to.

One of my favorite Atlas Shrugged quotes:

"Did you really think that we want those laws to be observed?" said Dr. Ferris. "We *want* them broken. You'd better get it straight That it's not a bunch of boy scouts you're up againstâ€“ then you'll know that this is not the age for beautiful gestures. We're after power and we mean it. You fellows were pikers, but we know the real trick, and you'd better get wise to it. There's no way to rule innocent men. The only power any government has is the power to crack down on criminals. Well, when there aren't enough criminals, one makes them. One declares so many things to be a crime that it becomes impossible for men to live without breaking laws. Who wants a nation of law-abiding citizens? What's there in that for anyone? But just pass the kind of laws that can neither be observed nor enforced nor objectively interpreted â€“ and you create a nation of law-breakers â€“ and then you cash in on guilt. Now that's the system, Mr. Rearden, that's the game, and once you understand it, you'll be much easier to deal with."

Val

I have a great deal of experience collecting this information for compliance reasons in a major wire house. Patriot Act requirements do add a bit of due diligence to the 'know your client' thing, as well as other regs, but most of it is overkill as mentioned by Dr T and Not Sure. However, there is also a lot of data collection that has nothing to do with any of that,intended only to give advisors (or their equivalent) ammo for prospecting more of your assets.

anon

Good thing the war on terror is such a success, defending our american freedoms that the foreigners hate us so much for.

Johnnyreb

"â€œCompliance seems to be a matter of opinion, not following a set of instructions for building a widget.â€

Iâ€™m completely convinced itâ€™s designed that way. If the rules are clear, you can follow them (or not, I suppose). If the rules are not clear, however, everybody ends up violating them at one time or another, leaving the government free to stomp on you whenever they have a mind to."

This is exactly how the BATF operates. They publish nearly impossible to comply with regulations and then go on witch hunts when a period is forgotten after a middle initial in the name block or an State abbreviation is entered on a form and not the name of the State spelled out. The BATF has shut down many gun dealers permanently over nothing but minor clerical errors.

KH

I can buy a cell phone at walmart for $15 cash, and buy pre-paid airtime cards for cash as well. I can get the cell phone turned on by visiting a website from a computer that is not connected to my name in any way. In other words, the cell phone is 100% anonymous.

They want ID for a WIRED line? They gotta be lying.

Reformed Republican

Don't worry KH, they are working on eliminating that, too.

tomw

While my wife was visiting her grandson, I attempted to renew her license plate. Her name and my name are both on the title. We have lived at the same location for almost 20 years. My picture and address are on my drivers license, and the address on the registration papers matched perfectly.
I was informed I needed my wife's license, or a copy, to re-register her car. I could not use my license and pay for the registration as my name was second on the title.
Another ridiculous attempt by legislators to protect us from something, with frustrating consequences, yet they ignore the throw-away cell phones providing anonymity for $20.
tom

CB

ask for documentation of the regulation. in other words, ask them to prove it.

Wait! You are questioning this? Now you are definitely on a terrorist watch list.

frankania

Welcome to Govt! They are all the same everywhere.
Here in Mexico, we are often asked for a "domestic receipt" (lights, phone, water etc.) to prove our address. But in order to sign up for a domestic service, they ask for a "domestic receipt". Many people use one from a neighbor, because they don't even care WHAT NAME IS ON IT.
Thus, we alomst all have phoney addresses here.
catch 22?

Rick C

Everyone does this. I once tried to take back a gameboy game to Walmart. They told me they couldn't "because of copyright."

It's not worth it to point out that 1) that doesn't make any sense, and 2) the real reason you're not taking it back is the same reason you don't take back CDs, audiotapes, PC games, and so on, but this doesn't really apply, since you can't copy gameboy games! (Well, you can, but it's not as easy, and frankly, it's easier to just get a ROM anyway.)

You get a BS explanation because it's easier than giving out a real one (which may well be BS too.)

tehag

When you need medical or dental care,you will also discover this new federal requirement. If a citizen needs an ID to receive medical care, then we have passed the "vote them out" phase and moved onto "guillotine."

EarlW

I remember going to a local bank to transfer my corporate bank account. The same bank that has my house mortgage and personal line of credit.
The paperwork included a clause that made me personally responsible for ANY problem with any transaction. This was for an incorporated company.
I objected and pointed out that a) I wasn't going anywhere, b) the main objective of incorporation was to protect personal assets and c) I would suffer even if the error was theirs. After some hemming and hawing and a few calls to head office, they replaced that clause with a delay, to ensure that they got paid.

kinoshika

I like this particular article it gives me an additional input in the information a round the world. Thanks a lot and keep going with posting such information.
====================================Boiler Business